The Art And Practice Of Protecting American Technology

To talk about the ongoing high tech Whack-A-Mole game between the U.S. and China, we're joined by James Lewis. He's with the Center for Strategic and International Studies in Washington.

And, James Lewis, we've heard about parts for missile guidance systems, but what other kinds of technologies are vulnerable to China's commercial cyber espionage?

JAMES LEWIS: Really, all kinds of technology, ranging from the high-end stealth fighters, missile guidance systems; to the low end: genetically modified seeds, wooden furniture, commercial goods, things like soap formulas. The Chinese will take anything that isn't nailed down.

CORNISH: But given technology today, there's plenty of stuff out there that could be dual use, right? Like a laptop in the wrong hands can be a military weapon or a consumer product. So is U.S. law consistent across the board about deeming something acceptable or not?

LEWIS: No, that's been a problem now for more than a decade, in that the people implementing the law tend to be, you know, relatively conservative, pretty risk-averse. For a long time, there was a debate about whether, you know, the PlayStation should be controlled because the chip in it was so powerful and whether aircraft could be sold to China - commercial aircraft - because they had a powerful navigation chip in it. So we have a system that's a little bit out of whack with reality.

But, at the end of the day, the Chinese can't make a lot of this stuff and so they have to try and get it from someone.

CORNISH: So help us better understand what about those particular technologies would be at the heart of the debate?

LEWIS: When it comes to information technology, the progress over the last 40 years has been so dramatic that the supercomputers that they had to design nuclear weapons are now probably less powerful than your iPhone. And so you've got to adjust. You've got to say here's a chip that 20 years ago deserved to be controlled, and nowadays it's a mass-market product. And our system is a little rusty when it comes to moving things.

The chip in question on the aircraft was for navigational purposes. And some people in - more in the State Department said that the Chinese would buy a $70 million commercial airliner just so they could take the chip out, which would render the aircraft inoperable, and use it in their missiles. Not even the Chinese are that crazy. So we've got a long set of technologies that have slowly moved from the military world to the commercial world.

There is a set, though, that remains purely military. And a list that focused on them remains crucial to security.

CORNISH: Are there competing interests within the U.S. government? I mean, I can imagine that the Pentagon wants to keep much more out of the hands of the Chinese than, say, the Commerce Department?

LEWIS: You know, actually there is an effort under way in this administration to reform the arms export controls. And they've made some progress. It's gone really slowly. It's still a very difficult set of regulations.

CORNISH: What's your take on the prosecutions? I mean, how aggressive as the U.S. been about this? Who are they going after? And, you know, who are the soft targets?

LEWIS: You know, the U.S. has been pretty aggressive in going after Chinese spies. And this includes both FBI and the agencies that were customs - now at Homeland Security. The problem is that there's so many of these people that we're just overwhelmed. And a few prosecutions aren't going to deter China from doing this. It has to be a diplomatic issue. But until we push it up to that level, you can prosecute as many people as you like, it's not going to stop.

CORNISH: At the end of the day, is there a conflict of priorities here between the U.S. and China, in terms of our concerns about commercial espionage versus regular old, you know, country spy-versus-spy espionage?

LEWIS: You know, the Chinese have a different view. Our view is countries spy on each other. And when you do it for national security purposes we regard it as legitimate. What we don't regard as legitimate is stealing commercial technology purely to benefit a Chinese company. And the Chinese answer was really interesting. A Pelei(ph) officer said for China, economic growth and building our technological base are national security issues. So taking people's technology has been part of China's economic plans since they opened to the West.

CORNISH: James Lewis is director and senior fellow for the Strategic Technologies Program at the Center for Strategic and International Studies in Washington.